Biproxi is a tech company in the commercial real estate business, and tech companies are usually very good at eliminating middlemen. The commercial real estate industry is a thicket of middlemen, but unlike Airbnb or Uber, Biproxi is not trying to eliminate the middleman. Its purpose is to make it easier for all the various middlemen in get in touch, and stay in touch, with each other.
We spoke with Tabitha Satterfield, co-founder of Biproxi and veteran of commercial real estate, about the company’s mission to become “the Tinder of commercial real estate.”
Grit Daily: Tell us about your background.
Tabitha Satterfield: I started out with the commercial funds. Probably 15 years ago, I worked with a group that raised the funds to buy distressed debt from banks, and we would ultimately work out those loans or foreclose on them.
During the time that I spent there, I would utilize a platform called auction.com for the disposition of those assets. I became very familiar with how technology can be incorporated into a transaction process. I left the fund and went over to auction.com, worked in their capital markets group for a couple of years. We built out a line of credit for people to go to auction houses or to the court houses and bid on properties without having to come with a cashier’s check and then be able to participate with a line of credit.
I spent a couple of years doing that and then decided to m, helping either brokers or sellers with a disposition through an auction platform. After a total of eight years at auction.com-slash-Ten-X, I moved over to a broker channel where I started educating brokers on how they could leverage technology to help with their disposition.
Fast forward a couple of years from there, I met my business partner Gordon at Ten-X while in that role. He wanted to start a company that didn’t have as many friction points. So that’s when we moved to build Biproxi and I’ve been with Biproxi for about three years now.
The Biproxi mission
Grit Daily: The mission of the Biproxi is to “fundamentally change the way commercial real estate is bought and sold.” How is it bought and sold now in a way that’s open to being changed? And what are some of the pressures against change?
Tabitha Satterfield: Everybody is very protective of their role, particularly if something’s been done the same way for the last 30 years. If a broker has been doing this for 30 years, they have their Rolodex of buyers. They are very big on networking and know who the buyers are. They wonder, “Why do I need to incorporate a technology tool?” But by not embracing technology, they’re losing out on accessibility to new buyers.
Transactions are big and fragmented. We’re marketing it here, we’re going to negotiate it here on this technology tool, or even in-house, and now we’re gonna bring in a finance partner and we’re gonna deal with that. Then we’re ready for escrow and title, and then the attorneys come in, so now you’re back to negotiating. There’s lots of these moving parts and emails that are passing through, and nowhere to really collaborate in one place. It’s very fragmented, so there is the opportunity for the technology to come in and change how it is done.
I think the most resistant are the brokers and the attorneys, who are charging hourly rates and obviously want to capture their fees.
The brokers fear they’re going to be replaced, but I believe that brokerage is an art form. There is a story to be created with each asset that is brought to them. But what technology can do is bring efficiencies into their process.
Grit Daily: Biproxi is self-described as the Tinder of commercial real estate. What does that mean?
Tabitha Satterfield: One of the features that we have developed is our buyer matching. We’re trying to understand what the acquisition goals are of each investor on our platform. We ask them, what is your CDRE experience? What are your assets under management? What are your acquisition goals in the next 12 months? They give us all of this information and when a broker is uploading a listing, we ask them to profile their deal. Where is the investor most likely located? Is it a local buyer? Is it a national buyer, a regional buyer? What kind of investor are you looking for?
Let’s say it’s a Florida asset. We scrub our database for investors who have indicated that they would buy within this criteria and then we match it immediately upon publishing.
We’re being very proactive and putting those investors directly onto the dashboard of that broker so they can have a one-on-one outreach based on the match.
Grit Daily: Commercial real estate seems complex because often it gets into zoning and permitting, with a lot of local political, and bureaucratic involvement. So I think of commercial real estate as pretty clubby and local or regional. Am I, to what extent am I right or wrong about that?
Tabitha Satterield: People definitely will stick with certain asset classes, unless there’s a huge shift in market trends. One example is industrial property. Amazon has different logistics facilities and they want to expand nationally, so people started saying “Okay, there’s something going on here and our regional mall is dead. I’m going to start moving my money over to industrial (property).
We do have international buyers, national buyers. Just because I’m sitting in Montana, I may like Southern Florida. So I will be very aware of what’s going on in that market. And the technology accessibility. I don’t have to be in that market to look at trends. Are people moving from New York, New Jersey down to Florida? Is it housing that they need down there? Is it hospitality? Is it retail? And then as an investor, if I have an appetite for a certain asset class, then I can find a piece of land to develop.
There are all kinds of different appetites for different types of real estate. It’s not the same as “I need a house, here is the neighborhood where I want to live.” There is a lot more complexity and motivation for those asset classes.
Grit Daily: What are the hot commercial real estate markets now? I’m asking about geography, but is that the right way to think about it? Is it really about asset class?
Tabitha Satterfield: It’s a little both. We’re looking at how people spend time in their community. Are they going out to regional malls? Not really, anymore. Most people are buying online. Michigan has a great example of this at one of their malls where the big box retailers moved out. Now they have this empty big box and it’s an eyesore. So what can they do differently? Ford took a big chunk of that mall and made it into an office. They to created this place to work, play, shop, and eat, all in the same facility. It was a really interesting way to repurpose a piece of real estate.
Grit Daily: What do you see happening with malls?
Tabitha Satterfield: It’s really interesting. People like curated shopping experiences. If a store feels “boutiquey,” people still want that experience. Malls willing to pump in the dollars to give it a facelift will have a better chance of surviving.
Some people are just looking at malls as land. Can we tear down this mall and build a parking structure? Or something like that.
Grit Daily: What are the emerging markets or the overlooked markets for commercial real estate that you guys are onto that maybe are not more generally known?
Tabitha Satterfield: The pandemic definitely shifted a lot of markets that were kind of overlooked. Allowing people to work remotely has dispersed a lot of people.
New York kind of felt flat. People were like, well, why am I going to pay to live in this small box when my company’s not requiring me to come back to the office? That has made a big shift in trends. Florida, Texas, Montana saw a huge growth. They didn’t have enough housing to support people who were coming there.
Memphis is another good example worth paying attention to. Ford is moving a plant to Memphis. FedEx and Nike are already there. They’re going to need housing, they’re going to need retail, all of the things that you would expect out of the community.
Another interesting thing is that KKR just raised funds to repurpose office buildings in New York City into housing. There just is not enough housing to meet demand, but they have a 40% (office) occupancy rate right now. So they’re raising a fund to convert to build more housing within New York City.
Grit Daily: Is Biproxi raising funds?
Tabitha Satterfield: We will be going into a Series A in the early spring. But right now, we’re working on adoption at this point. We just turned on our paywall on the 1st of December. We are starting to convert our users who are already in there as well as grow our user database.
But eventually we will be back out raising more money.